Thursday, 26 May 2016
Last updated 16 hours ago
May 19 2014 | 11:25am ET
Harbinger Capital Partners' wireless internet venture doesn't have an approved restructuring plan, but it does have expenses, which continue to pile up as the company awaits an exit from bankruptcy and approval of its planned network.
LightSquared, which has been in bankruptcy protection for two years, spent $55.4 million in April, it said in a court filing. Most of the money—$36.9 million—went to debt payments, with another $4.6 million to lawyers and others working on the bankruptcy case and $1.3 million to pay its staff.
All told, LightSquared has spent $1.3 billion since filing for bankruptcy.
Earlier this month, U.S. Bankruptcy Judge Shelley Chapman rejected LightSquared's restructuring plan, which is backed by Fortress Investment Group. She ruled that the proposal was unfair to LightSquared's largest creditor, Dish Network Chairman Charles Ergen, while also finding that Ergen had improperly purchased the debt and should have some of his claims subordinated.
Chapman ordered both side to sit down and come up with a new plan by May 27, threatening to impose mediation if they fail to reach accord. The judge cited the continuing costs of the case for the urgency.
LightSquared is still awaiting federal approval to deploy its wireless network. The Federal Communications Commission rejected its original plan, citing interference concerns with global positioning systems.